FCC votes for Internet “fast lanes” but could change its mind later

Chairman: "There is one Internet: Not a fast internet. Not a slow Internet."

The Federal Communications Commission today voted in favor of a preliminary proposal to allow Internet "fast lanes" while asking the public for comment on whether the commission should change the proposal before enacting final rules later this year. The order was approved 3-2, with two Republican commissioners dissenting.

Further Reading

Pay-for-play is fine for Web users? That's not what the FCC said in 2010.

The Notice of Proposed Rulemaking (NPRM) concerns "network neutrality," the concept that Internet service providers should treat all Internet traffic equally, even if it comes from a competitor. But the rules, while preventing ISPs from blocking content outright, would allow ISPs to charge third-party Web services for a faster path to consumers, or a "fast lane."

The FCC's prior net neutrality rules issued in 2010 were largely struck down in court, and there is already speculation that the new proposed rules could be threatened in court as well.

The proposal faces widespread protest from people who believe that rich companies paying for greater access to Internet subscribers will disadvantage startups and companies with fewer financial resources. The meeting today was disrupted twice by protesters who were led out of the room while shouting opposition to rules that degrade network neutrality. (We'll have coverage of the protests later today.)

In response to earlier complaints, FCC Chairman Tom Wheeler expanded the requests for comment in the NPRM. For example, the FCC will ask the public whether it should bar paid prioritization completely. It will ask whether the rules should apply to cellular service in addition to fixed broadband, whereas the prior rules mostly applied just to fixed broadband.

The NPRM will also ask the public whether the FCC should reclassify broadband as a telecommunications service. This will likely dominate debate over the next few months. Classifying broadband as a telecommunications service would open it up to stricter “common carrier” rules under Title II of the Communications Act. The US has long applied common carrier status to the telephone network, providing justification for universal service obligations that guarantee affordable phone service to all Americans and other rules that promote competition and consumer choice.

Consumer advocates say that common carrier status is needed for the FCC to impose strong network neutrality rules that would force ISPs to treat all traffic equally, not degrading competing services or speeding up Web services in exchange for payment.

ISPs have argued that common carrier rules would force them to spend less on network upgrades and be less innovative.

The full text of the NPRM is not public yet but should be so shortly. (UPDATE: Here it is.)

The FCC will accept initial comments from May 15 until July 15 and reply comments until September 10 on its website.

FCC split along party lines

Each commissioner made a statement before voting.

Wheeler, a Democrat, said, "There is one Internet. Not a fast internet. Not a slow Internet. One Internet." Wheeler previously complained that his proposal was being misinterpreted. Today, he said, "Those who have been expressing themselves will now be able to see what we are actually proposing."

"Nothing in this proposal authorizes paid prioritization despite what has been incorrectly stated today. The potential for there to be some kind of a fast lane available to only a few has many people concerned," Wheeler continued. "Personally, I don't like the idea that the Internet could be divided into haves and have-nots and I will work to see that that does not happen. In this item we have specifically asked whether and how to prevent the kind of paid prioritization that could result in fast lanes."

Further Reading

One activist calls FCC's proposal "a nail in the coffin" for American innovation.

Wheeler has said he would consider using Title II rules if it turns out that ISPs discriminate against smaller companies. Today, he said it would be "unacceptable" for ISPs to squeeze out smaller voices. His statement that "nothing in this proposal authorizes paid prioritization" may be technically true if the proposal simply enforces a baseline level of service and doesn't take a position on whether third-party services can pay for more than that. Or he may simply have been referring to the fact that the NPRM is not in itself a final set of rules.

In an explainer document, the FCC said that it "tentatively concludes that priority service offered exclusively by a broadband provider to an affiliate should be considered illegal until proven otherwise." This could mean agreements are allowed as long as each third-party service is offered similar, commercially reasonable terms. Affiliated content is generally content the ISP owns itself or through shell companies.

FCC expert Harold Feld, senior VP of Public Knowledge, agrees with that interpretation. "The law, in its majestic equality, allows both rich and poor to pay for prioritization," he tweeted.

In response to our request for clarification, an FCC spokesperson said, "That’s not right. The presumption that exclusive contracts to prioritize affiliates’ traffic would be unlawful doesn’t answer the question of whether other forms of prioritization are OK. The notice seeks broad comment on what to do about prioritization arrangements, including whether paid prioritization should be banned outright."

Wheeler explained that he wants to force ISPs to provide the level of service they promise consumers:

If the network operator slowed the speed below that which the consumer bought it would be commercially unreasonable and therefore prohibited. If a network operator blocked access to lawful content it would violate our no-blocking rule and be commercially unreasonable and therefore be doubly prohibited.

When content provided by a firm such as Netflix reaches a network provider it would be commercially unreasonable to charge the content provider to use that bandwidth for which the consumer had already paid, and therefore prohibited. When a consumer purchases specified network capacity from an Internet provider, he or she is buying open capacity, not capacity a network provider can prioritize for their own purposes.

Wheeler said that peering agreements, such as the ones in which Netflix purchased direct connections to the edges of the Verizon and Comcast networks, are "a different matter that is better addressed separately. Today's proposal is all about what happens on the broadband provider's network and how the consumer's connection to the Internet may not be interfered with or otherwise compromised."

Democratic Commissioner Jessica Rosenworcel said she wants to prevent a "two-tiered Internet" with rich companies having advantages over poorer ones. She said Wheeler should have moved less quickly in advancing proposed rules but that she is glad he put "all options on the table" by asking for comment on Title II and a potential ban on paid prioritization.

Democratic Commissioner Mignon Clyburn said the proposal changed significantly in the week before the vote. She said she's heard from educators who are worried that the proposed rules will prevent students from taking advantage of the best technologies. She's also heard from health care professionals who worry that medical images will load slowly and that patients will be unable to benefit from the latest technologies. However, she stressed that the NPRM is far from a final set of rules.

Republican Commission Ajit Pai said that "five unelected officials"—i.e. the commissioners—shouldn't decide the fate of the Internet. Instead, elected officials should take the lead, he said.

Today's debate was spurred by a federal appeals court ruling in January that struck down previous rules the FCC issued to ban blocking and paid prioritization. Verizon had challenged those rules, winning a substantial victory in court. The judges said the commission could not use its Section 706 authority—which requires the FCC to encourage the deployment of broadband infrastructure—to issue de facto common carrier rules.

Wheeler still wants to use Section 706, but he wants to set a baseline level of service that ISPs will have to offer, effectively preventing them from blocking third-party applications. While ISPs could charge Web services for a faster path to consumers, they would have to do so on "commercially reasonable" terms.

Republican Commissioner Michael O’Rielly said the commission hasn't tried to identify any market harm and thus shouldn't issue the rules in the NPRM. He also argued that the FCC has invented new authority to regulate the Internet by exaggerating its Section 706 authority.

Wheeler cited that decision in justifying the use of Section 706 to regulate how Internet providers treat third-party traffic. He said that using Section 706 is the fastest path toward getting enforceable neutrality rules, but he's willing to use Title II if necessary.

However, observers both for and against network neutrality have already expressed skepticism about whether Wheeler's interpretation of Section 706 would pass legal muster.